Citigroup’s Earnings Beat Expectations Despite Market Conditions

The bank is adapting to volatile market conditions better than expected.

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Citigroup's third-quarter results were better than anticipated overall, in spite of a turbulent market.

Citigroup reported better than expected earnings results this week for the third quarter. The bank report earnings of $1.97 per share, better than the $1.95 anticipated. Revenue of $18.6 billion beat the anticipated $18.545 billion analysts expected.

Currency, commodities, and fixed income trading were lifted by higher rates during the third quarter. It came in at $3.211 billion, higher than the $3.09 billion expected. 

Citigroup’s lending business posted a net interest income of $11.64 billion, lower than the $12.15 billion forecasted. The net interest margin is also lower at 2.56 percent instead of the expected 2.66 percent. Overall, Citigroup’s earnings beat analysts’ expectations.

Citigroup’s CEO Michael Corban said in a statement, “Despite an unpredictable environment throughout the quarter, we continue to deliver on our strategy of improving shareholder returns through consistent, client-led growth while also executing against our capital plan.” He also noted the strength of US consumers and the fact that branded card revenue expanded by 11 percent in North America during the third quarter.

Despite the earnings win, Citigroup’s results still lagged behind peers such as Goldman Sachs, J.P. Morgan Chase, and Wells Fargo in the third quarter. J.P. Morgan reported record revenues. Goldman Sachs delivered disappointing profit but revenue came in-line with expectations. 

In early trading, Citigroup’s stock fell by 2 percent. 

Last quarter, Citigroup’s stock fell by 1.4 percent. It was mainly due to wild swings in Treasury Yields. The Treasury yields fell to 1.4 percent from 2% from July to September that pushed financial stocks into correction territory. Now that the Treasury yield has recovered, financial stock performance has been lifted.

Overall, Citigroup beat earnings and struck a welcoming tone with investors. 

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